Bo’s Coffee is a leading coffee chain in the Philippines. The company was established in Cebu, and based in Cebu, it operates stores throughout the Philippines.
Almost every mall in Cebu has Bo’s Coffee. Outside the mall, you can often see Bo’s Coffee while walking around town. In Japan, it’s like Dotr coffee. There are more than 30 stores only in Cebu Island. As of 2018, there were nearly 100 stores in the Philippines.
Entrepreneur.com.ph has an interesting article about Bo’s Coffee’s marketing strategy.
The article said that as the world’s largest coffee chain, Starbucks, moved into the Philippines, Bo’s Coffee was in an all-time predicament.
How did Bo’s Coffee compete with Starbucks to survive the prospect of being swallowed by the world’s largest coffee chain?
Here’s Bo’s Coffee’s strategy:.
Starbucks to expand into the Philippines
“I felt threatened at first, because with a big brand like them, you don’t have to be so desperate to get rid of your own business.”
Bose Coffee (Bo’s Coffee) founder Steve Benítez spoke quietly.
When they heard that Starbucks was going to open a store in the Philippines, they were horrified.
Steve opened Bo’s Coffee in Cebu in 1997. Not long after, Seattle-born global chain Starbucks has finally opened a store in Metro Manila.
Starbucks already had 1,412 stores worldwide at the time. It’s only a matter of time before we move from Manila to Cebu.
The difference between brand power and capital was obvious, and people around me thought that a privately owned Bo’s Coffee would be crushed to death.
But Steve is determined to take on the giant American chain. Steve had a dream.
The dream is to open a chain of Bo’s Coffee shops from Cebu throughout the Philippines. Fighting Starbucks is the only way to make your dream come true. For Steve, the Starbucks showdown was “unavoidable fate”.
From soil to cup. Bo’s Coffee serves freshly ground coffee grown in Philippine soil.
confront the global giant chain
He decided to fight, but at first he didn’t know what to do.
“I didn’t know what to do. We didn’t know what the impact would be on our company. I just knew I had to be prepared.”
The fate of Bo’s Coffee depended on Steve, the company’s president and CEO. At first, Steve was overwhelmed by fear, but as he became more determined to fight, he began to think of reversing the situation.
Starbucks’ move into Cebu was seen as a great opportunity to improve its product line and services.
“Okay, if they can do it, we can do it.”.
Steve took a fresh look at the Bo’s Coffee store. By doing so, we will establish a basic policy.
We decided to focus on what the Filipino coffee experience would be like by raising the level of our products, improving our brand and spotlighting Filipino coffee.
Bo’s Coffee uses coffee beans hand-picked in the highlands of the Philippines.
If you come to the Philippines, you can experience Filipino coffee.
Instead of following the textbook marketing model used in many business models, Steve decided to promote Bo’s Coffee as a “Philippine brand”.
“‘Bo’s Coffee is a world standard domestic brand using coffee beans from the Philippines.’ he said. By doing so, you can differentiate Bo’s Coffee from other coffee chains. Furthermore, by emphasizing the domestic brand Bo’s Coffee, we were able to find ‘New market focused on domestic products’.” Steve said.
Marketing guru Joshua Goh (Josiah Go) praised Steve’s innovative marketing strategy.
“What you choose is the key to your strategy. In order to dominate the market, brands must determine and select where they create value and how they generate revenue. A strategy that differentiates itself based on a sense of locality is effective as an option to fight against large chains from overseas. No matter how powerful your foreign competitors are, you can’t replicate this positioning.”
Joshua called Bo’s Coffee’s strategy of focusing on Filipino coffee beans “It was an excellent marketing that focused on the narrow point of the needle.”.
Bo’s Coffee took the pinch of Starbucks and turned it into an opportunity to rebrand.
“It’s just a concept enhancement. And we just went back to the starting point. We put the value of Bo’s Coffee in the experience of Philippine coffee.”
Bo’s Coffee took on the world’s largest coffee chain, Starbucks, by positioning itself to focus on domestic coffee beans.
Fresh Sealed. Handpicked coffee beans from the highlands are then bagged and shipped to Bo’s Coffee shops throughout the country.
In order to convey the goodness of domestic production
I’ve never heard of Filipino coffee in this article, but
you might wonder if it’s really good
Today, the Philippines is not one of the world’s top 10 coffee bean producers. But actually, there was a time when the production of coffee beans from the Philippines was the top in the world, exceeding Brazil and Africa.
The Philippines is still a supplier of coffee beans for Nestle and other major coffee makers. You may be tasting coffee beans from the Philippines without knowing.
Bo’s Coffee sticks to its local flavor and now adds a more Filipino feel to the store’s exterior and uses more domestic coffee beans.
The brand mission of Bo’s Coffee is “Providing positive impact to society by supporting Philippine coffee farmers” and “Providing visitors with delicious Filipino coffee and unique hospitality”.
Recently, they have expanded to include handmade goods from the Philippines and are selling them in the store. This has led to an increase in the number of visitors to Bo’s Coffee looking for souvenirs from the Philippines.
The Future of Bo’s Coffee
Bo’s Coffee’s strategy is to focus on Filipino coffee, which competes pretty much with Starbucks.
As of 2018, Starbucks in the Philippines had about 300 stores. Bo’s Coffee has expanded from Cebu to Metro Manila, Visaya and Mindanao.
Given the huge gap in capital, Bo’s Coffee is doing well.
Steve says he hopes to spur further business expansion in the future. He opened an office in Manila in 2014 to take the initiative in business expansion.
“Over the past two years or so, we’ve been focused on making our systems and organizations strong, and we’re finally ready. There are good teams that share my vision. Finally, I want to increase Bo’s Coffee to 100 stores.” Steve said.
As far as I can tell from the Bo’s Coffee website, Steve’s dream of 100 stores is coming true pretty soon.
But Steve looks beyond that.
“We’re ready to go to the world stage.” Steve said with a twinkle in his eye.
With ASEAN (Association of Southeast Asian Nations) economic integration beginning at the end of 2015, competition is expected to intensify going forward, but Steve isn’t afraid at all.
“We are a domestic brand. I know a lot about the market.”
Steve’s eyes are already on the world.
Comments from the administrator
Bo’s Coffee is more common than Starbucks in Cebu, Philippines. Why is Bo’s Coffee the only one to survive as some coffee shops from the Philippines go out of business?
As mentioned above, Bo’s Coffee claims that it’s from the Philippines, and it’s a PR strategy to take care of the local area. We may not be able to maximize the number of customers like Starbucks, but if we convey our message properly, we will be able to acquire a certain number of fans as “Locally Loved Coffee Shop”.
I didn’t know that Bo’s Coffee uses beans from the Philippines until I read this story. However, if Bo’s Coffee has such passion, I would like to support Bo’s Coffee from now on!!